Work in progress

Think of Egypt and the chances are that images of colossal monuments to long-dead Pharaohs or lonely feluccas sailing down the Nile will spring to mind.

But when it comes to the IT industry the channel has a different vision - one of untapped potential, regional importance and a chance to make a mark on a fertile landscape.

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Out of all the African nations the Egyptian IT market has always been the one that has held the most potential and interest in terms of channel development.

 

In recent years the government, under the guidance of previous Egyptian Prime Minister Dr. Ahmed Nazif, introduced many positive catalysts for growth and change.

Almost three years ago Nazif implemented tax reforms and privatised large enterprise organisations. Government spending over the last year has accounted for almost a third of all IT spending on services.

It also set up the Information Technology Industry Development Agency, which if some commentators are to be believed has had a profoundly positive effect on the IT business and helped attract some high-profile names.

An analysis of the PC market carried out by research house IDC classifies Egypt as one of the most promising markets in the Middle East and Africa region thanks to its large population, improving economy and attractiveness to foreign investors.

IDC expects the Egyptian PC market to expand at an average annual rate of 16.5% in volume and 16.2% in value through to 2011, as economic stability in the country promotes greater PC purchasing.

Despite worries that Egypt is not developing mature habits, IDC also revealed that notebook shipments have skyrocketed in recent times with unit shipments doubling year-on-year.

The concerns of those who believe the Egyptian market is performing below its potential are well founded though.

IDC also looked at the deployment of value-added and support services - the type of business development expected of a mature market - and found Egypt wanting of a greater investment.

"Most companies in Egypt lack the financial resources necessary to invest in IT services," said Vladimir Kroa, research director for IT business services at IDC CEMA.

"Many of them have not yet finalised their IT infrastructure - hardware and software systems that need to be in place before a firm begins contracting more sophisticated third party IT services. Finally, Egypt is an emerging economy meaning it is difficult for firms to align their IT processes with their business objectives."